Nov 28, 2014 4:22 AM
Energy shares slide after OPEC decision
The Associated Press
HONG KONG (AP) Crude oil and energy shares tumbled Friday as OPEC's decision to keep production steady rippled across the globe. Japanese stocks rose after a slew of uninspiring economic data raised hopes that more stimulus was in the pipeline while other global indexes were mixed.
KEEPING SCORE: European shares opened lower, with France's CAC 40 down 0.6 percent to 4,356.26. Britain's FTSE 100 fell 0.8 percent to 6,673.24 and Germany's DAX slipped 0.7 percent to 9,905.45. U.S. shares were poised to fall at the open, with Dow futures dipping 0.2 percent to 17,773. Broader S&P 500 futures lost 0.2 percent to 2,067.
ENERGY SLUMP: The oil cartel decided to maintain production at 30 million barrels a day despite global oversupply, as the Saudis and their Gulf allies hope to pressure rival producers in the U.S. That sent oil prices to four-year lows. Benchmark U.S. crude oil tumbled 6.8 percent, or $4.99, to $68.70 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, used to price oil sold on international markets, slipped 61 cents to $71.97 after losing about $5 in the previous session.
BIG MOVERS: Oil-related stocks were the big losers following the slide in crude prices. Chinese state owned oil giant CNOOC, the country's biggest crude producer, plunged 5.5 percent and PetroChina slid 3.3 percent. Shares of Anglo-Australian miner BHP Billiton, which has crude oil interests, slipped 3.4 percent in Sydney. BP dived 3.9 percent in London and Total sank 4.6 percent in Paris trading.
ASIA'S DAY: Japan's benchmark Nikkei 225 index rose 1.2 percent to close at 17,459.85 while South Korea's Kospi slipped 0.1 percent to 1,980.78. Hong Kong's Hang Seng edged 0.1 percent lower to 23,987.45 while in mainland China the Shanghai Composite Index gained 2 percent to 2,682.83. Australia's S&P/ASX 200 tumbled 1.6 percent to 5,313.00. Benchmarks in Taiwan, Singapore and the Philippines rose while in Thailand, Indonesia and New Zealand they fell.
JAPAN DATA: A raft of data releases gave mixed signs about the state of Asia's second biggest economy but the Nikkei surged nonetheless, a sign that investors thought that the initial reaction to Prime Minister Shinzo Abe's renewed stimulus efforts wasn't enough and that more was in the pipeline. Inflation edged lower while industrial output edged up from the month before and unemployment eased slightly.
THE QUOTE: "If our forecasts are correct, the (Japanese) central bank is likely to come under pressure to deliver additional easing sooner than markets expect," with the announcement coming as early as the second quarter of 2015, HSBC economist Izumi Devalier said in a research report.
CURRENCIES: The euro slipped to $1.2450 from $1.2453 in late trading Thursday. The dollar eased to 118.10 yen from 118.12 yen.